Letter from Rome: Is free trade elitist or populist?

It’s good to be back in Rome following lots of travel in December and January, although it’s sad to see that the Italian capital is not changing for the better. Just about every other city I visited in Europe and North America seems to be growing; the sole exception is my hometown of Flint, Michigan, which is not usually included among popular tourist destinations of world-historical importance.

This unfair comparison aside, my take-away from these trips is that the global economy remains full of promise for those communities that are able and willing to do business. The airports, shops and restaurants were thriving, and people seemed generally upbeat about their lives. Returning to Rome, I can’t help noticing an even stronger, more pervasive sense of disorder if not despair for the future than before I left.

I also suffered through the experience of renewing my Italian work visa, which took much longer than anticipated but at last I obtained it. There’s no telling how many people lost how many productive work hours in the process. In stark contrast to the other places I visited, the government of Italy seems determined to push people away rather than attract them to live and work here. The migrants who risk their lives paying traffickers to put them on a raft in the Mediterranean only to end up panhandling on the street must question the wisdom of their decision.

There are many people, including some in the Vatican, who blame Italy’s woes on global capitalism. Italian manufacturers are no longer able to compete with cheaper products from China. The difference in wealth between Europe and Africa is said to encourage and even compel the poor to migrate. The single currency in Europe is said to have created fiscal crises in Greece and Italy.

Even if all these aspects were true (a highly debatable proposition), it neglects to address why some countries are better able to adapt to changing circumstances than others. Those who criticize economic inequality usually assume that some form of exploitation or marginalization is the problem: “The game is rigged” in favor of the already rich and powerful. Whatever damage capitalism may do inside a nation is only exacerbated by the globalization of economic activity, which apparently brings along with it a globalization of indifference to the sufferings of the vulnerable.

Left-wing parties under the sway of Marxism used to dominate such anti-capitalist discourse, but this is no longer the case. Pope Francis’s criticisms arise from Catholic social teaching, even if his immediate predecessors were more balanced in their appraisals. Economic nationalism has risen on the right, serving as a large, if not the predominant, factor behind the Brexit and Donald Trump victories of 2016. What unites these ideologically disparate, non-Marxist foes of globalization is their distrust of the elites who have governed the institutions of global capitalism; this distrust is the basis for the phenomenon of economic populism on both the left and the right against the centrist “establishment.”

Even with the rise of populism, the elites remain. There is not getting around the political reality of the few and the many, as first and best described in Aristotle’s Politics. See, for example, Pope Francis’s and Trump’s recent messages to the World Economic Forum in Davos. Each took the opportunity to cajole, not castigate, the annual gathering of global capitalists. The Pope and the President even agree in putting people over profits, with Francis’s concerns (and job description) being only more universalistic than Trump’s. Neither denied the possibilities of free trade and economic growth to help the working class and the poor.

It is also likely that the elites have sensed the populist moment and are seeking to coopt or capitalize on it. Is such an elitist-populist convergence possible? Perhaps, according to John O’Sullivan. Writing in the Hungarian Review, he recalls how wise politicians such as Australia’s former Prime Minister John Howard have been able to advance a combination of left- and right-wing populism against the centrist political class to great effect. O’Sullivan also cites Pierre Manent’s “fanaticism of the center” that comes at the expense of the politics of class and nation. If our problems are more political or cultural (as Charles Murray and Jennifer Roback Morse continue to argue) than economic, bashing capitalism is a misleading, counterproductive solution.

As I’ve written in previous letters, we are in the midst of a political/cultural realignment, one in which capitalism can no longer be taken for granted but remains necessary for the material well-being of people all over the world. No one knows which direction it will take, but it seems more likely than not that the global economy is adjusting to the more inclusive spirit of the times. At least for those of you outside of Italy.

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Kishore Jayabalan is director of Istituto Acton, the Acton Institute's Rome office. Formerly, he worked for the Vatican's Pontifical Council for Justice and Peace as an analyst for environmental and disarmament issues and desk officer for English-speaking countries. Kishore Jayabalan earned a B.A. in political science and economics from the University of Michigan, Ann Arbor. In college, he was executive editor of The Michigan Review and an economic policy intern for the U.S. Chamber of Commerce. He worked as an international economist for the Bureau of Labor Statistics in Washington, D.C.